Economy is healing, but slowly
Today's U.S. employment report confirms that the U.S. economy is recovering-but only at a slow pace and with different trends in different sectors.
The household survey showed a drop in the unemployment rate from 9.2% to 9%-but that mostly reflected a drop in the labor force participation rate which fell to a new multi decade low (as well as a downward revision of population). Actual employment rose ony 117,000, only barely enough to keep up with the population growth rate.
The payroll survey showed an increase in employment of only 39,000 with the private sector adding 50,000 jobs. Job growth is especially strong in manufacturing while construction continued to losejobs, confirming the sectoral trends discussed earlier this week.
Meanwhile, average hourly earnings rose unusually much, 0.35%, but as the average work week fell by 0.3%, average weekly earnings barely rose at all in nominal terms.
By contrast, the northern neighbor of the United States published a quite strong employment report, with employment increasing the equivalent of nearly 600,000 in the U.S. The increase was disproportionately in part-time jobs, but even full-time employment increased significantly.
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